Corporation Governance、 Cash Holdings And Corporation Value

Cash, as the most liquid assets in the corporation, play a vital role in the daily business activities in enterprises. About holding cash, on one hand, corporation will consider the benefits of holding cash, on the other hand, will consider the costs of holding cash. Therefore, the analysis of influencing factors on cash holdings and the value effect to the enterprise from cash holdings has been the focus debate in academia as well as in practical area. As manufacturing industry in our country, owning the largest number of listed companies in all industry, the influencing factors of cash holdings and its value to corporation will be of great significance. In this paper, we use the method of combination of qualitative and quantitative analysis to study the relationship between cash holdings and corporate governance and the value effect to corporation from cash holdings in manufacturing listed corporates.In qualitative analysis, through Sorting and summarizing about cash holdings theory and corporation value theory, this paper analyzes the relationship between cash holdings and corporate governance in our manufacturing listed corporation facing Special macro environment,also introducing the financial factors as control variables to the relationship.In addition to the analysis of the relationship between cash holdings and corporation governance,this paper analyzes the value of cash holdings to the corporation in listed manufacturing companies.In quantitative analysis, this paper takes the cash and cash equivalents accounted for the total assets ratio as a corporation cash holdings level, Tobin’s Q value as the value of the corporation, making an empirical test on relationship between corporation governance and cash holdings based on year 2009 to 2013 in our manufacturing industry listed corporation. The empirical results show that the proportion of state-owned shares, concentration has positive effect on cash holdings in China’s manufacturing industry listed corporation, while Independent director ratio, the size of the board of directors, managerial ownership’share ratio, shareholder protection level have negative effect on cash holdings. Then, the corporation shareholding ratio and the chairman of the board and general manager concurrently by the same person have no effect on cash holdings. In addition, this paper also studies the value effect to the corporation in our manufacturing listed companies, this study found that the value of cash holdings will have positive effects on the enterprise value in our manufacturing listed enterprise.